This is a proposal to allocate SWISE from the StakeWise DAO Community Treasury to the StakeWise Liquidity Committee (SLC) to be used solely to incentivise the liquidity ecosystems of all StakeWise tokens. Please take the time to review the report from the previous month (link) and the proposed budget for the upcoming month before voting. The vote is live and can be found (link).
For a high-level overview of how StakeWise DAO’s SWISE emissions have evolved over the previous months, see the following chart:
Note: October emissions adjusted to 0 to reflect the use of borrowed funds and existing funds already available in the SLC safe, as no new requests were made during this period. The significant increase in November emissions accounts for the resumption of regular funding requests, including the reimbursement of 4.6 million SWISE in borrowed funds to the team.
Report on the incentive allocation in December
| Inflows (Budget) | Outflows | |
|---|---|---|
| SWISE liquidity pool | 860,000 SWISE | 860,000 SWISE |
| osETH liquidity pools (Mainnet) | 6,160,000 SWISE | 6,400,000 SWISE |
| osETH liquidity pools (Arbitrum) | 600,000 SWISE | 600,000 SWISE |
| osGNO Liquidity pools | 0 SWISE | 0 SWISE |
| Team Reimbursement | 4,613,420 SWISE | |
| Total | 7,620,000 SWISE | 12,473,420 SWISE |
Starting SLC Safe Balance: 5,753,110 SWISE (01-December-2024)
- 4,613,420 SWISE was reimbursed to the team for supplying SWISE in October to ensure uninterrupted distribution of incentives.
Ending SLC Safe Balance: 899,690 SWISE (expected 31-December-2024)
osETH liquidity pools (Mainnet)
Liquidity in the osETH-ETH pool on Balancer remains robust, with a current total value locked (TVL) of $60 million.
The osETH-rETH pool on Curve has shown significant growth, with the osETH balance increasing by 376 (+16%) since the beginning of the month, indicating an improved liquidity balance. The total TVL for this pool stands at approximately $18 million.
The osETH-USDC pool on Uniswap has experienced notable growth, with the osETH balance rising to 18.3, representing a 134% increase since the beginning of the month. However, the pool remains at one of its lowest levels since May 2024, with a total TVL of $52,000, heavily skewed towards osETH, which accounts for 88% of the pool composition. The team is actively monitoring the situation and is prepared to intervene as necessary.
osETH liquidity pools (Arbitrum)
The combined liquidity levels for osETH pools on Arbitrum have stabilized at approximately $1M. To boost engagement, the osETH-ETH pool on Balancer is allocated 100,000 SWISE incentives per week, while the osETH-wstETH pool on Ramses receives 50,000 SWISE incentives per week.
Given the current TVL levels both in osETH-ETH and osETH-wstETH pools, the existing SWISE incentives offer an APY exceeding 15% for LPs.
The team is confident that this competitive APY will attract additional liquidity provision in both pools, driving an increase in TVL and enhancing liquidity depth for osETH on Arbitrum.
osGNO liquidity pools
The osGNO-GNO liquidity pool on Balancer has experienced a decline in TVL, dropping from approximately $5M in mid-November to $1.6M. This pool is not currently receiving SWISE incentives, as for the good portion of November and December osGNO was trading at a premium relative to GNO. With the introduction of 100% osETH minting in the Genesis Vault, the premium has mostly disappeared. Moreover, the Aave DAO is discussing the addition of osGNO to the Gnosis market on Aave, potentially requiring a larger amount of liquidity on the network. The team is actively monitoring the situation and will commence liquidity incentivization if needed.
SWISE liquidity pool
There are no major inflows or outflows to report.
Proposed budget for January
| Inflows (Budget) | |
|---|---|
| SWISE liquidity pool | 860,000 SWISE |
| osETH liquidity pools (Mainnet) | 5,940,000 SWISE |
| osETH liquidity pools (Arbitrum) | 600,000 SWISE |
| osGNO Liquidity pools | 0 SWISE |
| Total | 7,400,000 SWISE |
osGNO liquidity pools
The SLC has 400k SWISE on hand from previous month’s budget request to utilize when the 100% LTV update on Gnosis Chain goes live.
SWISE liquidity pool
The aim is to maintain current liquidity, requiring 860k SWISE per month at current market prices.
osETH liquidity pools Mainnet
The current liquidity depth is strong vs the overall TVL of StakeWise V3 and should be maintained. The expected cost for doing so is around 5.94M SWISE per month for mainnet. The team has decided to reduce the monthly incentives for the osETH-USDC pool from 440,000 SWISE to 220,000 SWISE, representing a 50% reduction. This decision is driven by the pool’s limited overall liquidity and user engagement, as the previous incentive level demonstrated minimal impact. By reallocating resources more efficiently, the team aims to optimize the use of SWISE incentives. The situation is being actively monitored, and the team remains prepared to intervene if necessary.
osETH liquidity pools Arbitrum
The current liquidity depth for osETH pools on Arbitrum is below optimal levels and requires improvement. Allocating 600,000 SWISE per month is expected to significantly enhance liquidity depth. This allocation corresponds to 150,000 SWISE incentives per week, which, given the resulting high APYs, is projected to attract additional liquidity to these pools and support sustainable growth within the Arbitrum ecosystem.